South Korea considers using fines from data breaches to fund victim compensation but faces implementation challenges

South Korea’s data privacy watchdog plans to use fines from companies for breach-related damages to help victims recover losses, though practical hurdles remain in direct compensation efforts, as the commission explores new funding models.

South Korea’s data privacy watchdog is moving towards using fines imposed on companies after personal information breaches to help victims recover losses, but its chair has warned that handing compensation straight to affected individuals would be difficult in practice.

Speaking at a plenary session of the National Assembly’s Legislation and Judiciary Committee in Seoul on Monday, Personal Information Protection Commission chair Song Kyung-hee said the commission had examined whether a separate recovery scheme could work, including models similar to funds for crime victims, but concluded the approach would not be easy to administer.

The commission said in its recent second-half work plan that it wants to create a consolidated fund to support the restoration of rights and compensation for people harmed by privacy violations. It is also weighing whether to use part of the fines collected from companies that conceal or destroy evidence of breaches to finance rewards for whistle-blowers, with payments of up to 30% of the penalty under consideration.

Song said the commission is trying to work with the planning and budget authorities on a public-interest reporting incentive fund that could also provide support for users and members of the public harmed by the fines regime. But opposition lawmaker Lee Hae-min argued that a separate fund should be established under the privacy watchdog so victims can be protected first and reimbursed later through recovery from offenders.

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Source: Fuse Wire Services